IRS Updates
From Brian Wozniak IRS/SB/SE CSO
IRS Kicks off 2012 Tax Season with Deadline Extended to April 17
http://www.irs.gov/newsroom/article/0,,id=251825,00.html
The Internal Revenue Service opened the 2012 tax filing season by announcing that taxpayers have until April 17 to file their tax returns. The IRS encourages taxpayers to e-file as it is the best way to ensure accurate tax returns and get faster refunds.
IRS Offshore Programs Produce $4.4 Billion to Date for Nation’s Taxpayers; Offshore Voluntary Disclosure Program Reopens
IR-2012-5: http://www.irs.gov/newsroom/article/0,,id=252162,00.html
The Internal Revenue Service reopened the offshore voluntary disclosure program to help people hiding offshore accounts get current with their taxes and announced the collection of more than $4.4 billion so far from the two previous international programs.
Revised Form 2848, Power of Attorney and Declaration of Representative
The revised Form 2848 and instructions issued Oct. 2011 include several changes. One of the most significant changes is for individuals who file joint returns. Each individual taxpayer will be required to submit separate Forms 2848 to the IRS Centralized Authorization File even if they are going to be represented by the same authorized representative(s). The individual(s) identified in the power of attorney will only be authorized to represent one person per Form 2848.
Other changes to the Form 2848 include:
- a new designation for registered tax return preparers;
- a new location for the check box to authorize the IRS to send notices to the representative;
- a requirement for the representative to enter a license, bar or enrollment number;
- no longer allowing both an SSN and an EIN on one Form 2848 for schedule C taxpayers; and
- removal of the ability of representatives to receive refund checks.
Publication 15, (Circular E) - The Employers Tax Guide http://www.irs.gov/pub/irs-pdf/p15.pdf
The 2012 revision of Publication 15, (Circular E) The Employer's Tax Guide has been finalized and recently posted to IRS.gov,
Revenue Procedure 2012-15
http://www.irs.gov/pub/irs-drop/rp-12-15.pdf
Revenue Procedure 2012-15 identifies circumstances under which the disclosure on a taxpayer’s income tax return with respect to an item or a position is adequate for the purpose of reducing the understatement of income tax under section 6662(d) of the Internal Revenue Code and the purpose of avoiding the tax return preparer penalty under section 6694(a).
FS-2012-6 & IR-2012-4: IRS Releases 2006 Tax Gap Estimates
http://www.irs.gov/newsroom/article/0,,id=252038,00.html http://www.irs.gov/newsroom/article/0,,id=252094,00.html
The Internal Revenue Service today released a new set of tax gap estimates for tax year 2006. The tax gap is defined as the amount of tax liability faced by taxpayers that is not paid on time.
The new tax gap estimate represents the first full update of the report in five years, and it shows the nation’s compliance rate is essentially unchanged from the last review covering tax year 2001.
Enrolled Agents & PTIN requirements
Per Circular 230 Section 10.4 – ALL Enrolled Agents are required to have and renew their PTINs on an annual basis (even if they do not prepare any returns for compensation). Additional reference: http://www.irs.gov/taxpros/article/0,,id=239678,00.html
Are individuals who are active attorneys, certified public accountants or enrolled agents required to obtain a PTIN if they do not prepare all or substantially all of any tax return? (revised 9/28/10)
Attorneys and certified public accountants do not need to obtain a PTIN unless they prepare for compensation all or substantially all of a federal tax return or claim for refund. All enrolled agents are required to obtain a PTIN.
Enrolled Agent Renewals:
As many of you know, the Enrolled Agent renewal period for SSNs ending in 4, 5, and 6 was delayed for 7 months while the IRS recomputed the fee and reduced it from $125 to $30. This delay interrupted the regular timeline of spreading renewals equally over a three year period. Additionally, many people delayed submitting new EA applications (Form 23) until the fee decrease was official. Oversight for processing enrollment applications and renewals was transferred from the IRS Office of Professional Responsibility to the Return Preparer Office. These factors unfortunately resulted in substantial inventory management challenges over the past few months. We have been closely monitoring the inventory and working diligently to resolve the backlog.
- Renewals for SSNs ending in four, five or six - All correct and complete Forms 8554 submitted before November 28, 2011, have been processed and cards issued. All remaining Forms 8554 require further research.
- Renewals for SSNs ending in seven, eight, nine, or none- We will begin processing these no later than January 30, 2012.
- New applications on Forms 23 - We are working overtime to process the backlog created by the delayed renewal cycle. The Form 23 inventory should be current and back to the normal 60 day response time by January 30, 2012.
- Phone and email delays - We have diverted the majority of our resources to processing renewals and applications. We're attempting to answer all contacts as they come in, all phone and email inquiries will be worked by January 30, 2012. We apologize for the delays and thank you for your understanding and patience.
Enrolled Agent Exam
Effective January 5, 2012 the fee to take the Special Enrollment Examination to become an Enrolled Agent increased from $101 to $105 per part. The amount has been updated on IRS.gov and in the SEE Candidate Information Bulletin.
RTRP Testing Update:
Here is the latest information about the Registered Tax Return Preparer test we launched in late November. Hundreds of people have taken the test and a substantial number of others are scheduled in the upcoming weeks and months. Based on this progress, we anticipate we will be able to provide test scores to those who have already tested and implement same day results by approximately March. Additionally, the test vendor has continued to expand the number of sites where the test is available. As of today, it is available at 237 sites. Another 30 sites should open in the next few weeks. A list of test sites is online at: http://www.irs.gov/taxpros/article/0,,id=250034,00.html
E-File Links and Miscellaneous Information
- 2011 Tax Year IRS e-file landing page (formerly Pub 1345-A): http://www.irs.gov/efile/article/0,,id=184807,00.html
- Publication 1345 – The e-file provider’s handbook: http://www.irs.gov/pub/irs-pdf/p1345.pdf
- 1040 Modernized e-File Program: http://www.irs.gov/efile/article/0,,id=204750,00.html
- Notice 2011-85 and the e-file Mandate http://www.irs.gov/irb/2010-51_IRB/ar12.html
- From the e-file mandate Q&As at http://www.irs.gov/taxpros/article/0,,id=231871,00.html
6. What does reasonably expect to file mean? When computing this number, estimate the number of covered returns you reasonably expect to prepare and file (or if you are a member of a firm, the firm reasonably expects to prepare and file) in the calendar year. See FAQ 7 for “When an income tax return is considered filed by a tax return preparer.” Do not include in this estimate the number of returns that you reasonably expect your clients (or the firm reasonably expects its clients) will choose to have completed in paper format and will submit (e.g., mail or otherwise deliver) to the IRS themselves. Also, do not include in this estimate the number of returns that you expect not to be able to electronically file for various reasons, e.g., a form not accepted in IRS e-file. See FAQ 19. This estimate is your reasonable filing expectation. 7. When is an income tax return considered filed by a tax return preparer? For purposes of this electronic filling requirement, a return is considered filed by a tax return preparer or specified tax return preparer if the preparer or any member, employee, or agent of the preparer or the preparer’s firm submits the tax return to the IRS on the taxpayer’s behalf, either electronically or in non-electronic (paper) form. For example, the act of submission includes the preparer or a member of the preparer’s firm dropping the return in the mailbox for the taxpayer. Acts such as providing filing or delivery instructions, an addressed envelope, postage estimates, stamps, or similar acts designed to assist the taxpayer in the taxpayer’s efforts to correctly mail or otherwise deliver an individual income tax return to the IRS do not constitute filing by the tax return preparer or specified tax return preparer as long as the taxpayer actually mails or otherwise delivers the paper individual income tax return to the IRS.
